The Budget has confirmed the Chancellor’s previous proposal to allow
the nil-rate band unused on a person’s death to be transferred to their
spouse. Whilst that does not completely eliminate the need for nil-rate
band trusts, it is very helpful where no such provision has been made.
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The recent CGT changes will see the introduction of a flat rate 18% CGT
(as from April). Previously, the rate of CGT was at the highest rate that a
person paid income tax on, so a top-rate taxpayer could have paid 40%.
This is, of course, good news for second-home owners who have to pay
CGT when they sell the second residence.
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A reminder that you must charge VAT on telegraphic transfer fees. These
should be included in your bill as part of your profit cost charges
(VATable), rather than as disbursements (which are not VATable). The
logic behind this is that the telegraphing of the funds is an integral part
of your service and therefore forms part of the work you do (ie your profit
cost). For guidance on this see note in [2008] LSG 7 February 29.
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When a business lease falls to be renewed under the Landlord and Tenant Act 1954 (the 1954 Act), the new lease is often granted some time after the contractual termination date of the old lease. The term commencement date may be backdated to then (or to some other administratively convenient date).
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If a business tenancy is renewed under LTA 1954, the new lease will
often be granted some time after the expiry of the old lease. When that
happens, the commencement date may well be backdated to then (or
some other date). What about SDLT during that overlap period? The
rules are complex and are best explained by an example.
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 When a business lease falls to be renewed
under the Landlord and Tenant Act 1954 (the 1954
Act), the new lease is often granted some time after
the contractual termination date of the old lease.
The term commencement date may be backdated
to then (or to some other administratively
convenient date).
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When a business lease fails to be renewed
under the Landlord and Tenant Act 1954 (the 1954
Act), the new lease is often granted some time after
the contractual termination date of the old lease.
The term commencement date may be backdated
to then (or to some other administratively
convenient date).
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If you have not already signed up for SDLT Online then you really should
do without any further delay. The advantages over paper-based systems
are obvious (as is evidenced by the fact that the number of Online
transactions increased by more than 50% in the last six months).
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Apparently, there are more than one-third of a million second homes in
the UK (and a similar number abroad). Thus, the principal private
residence (PPR) election for CGT purposes is very important. But, do
solicitors routinely advise clients to think in terms of making PPR
elections?
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Click to enlarge:
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Serviced building plots are sold with connections to services (ie water, gas,
electricity) already in place. The sale of such a plot will now be treated as
a single exempt supply (previously, the supply of the services was
separated, and had been treated separately from the supply of the land,
meaning that the buyer would have to pay VAT on the service element).
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Agricultural Ls should be wary before consenting to a request by T for
diversification. It is important for Ls to remember that they do not have
to consent to diversification. In Jewell [2002] there was a user covenant
providing for agricultural use only, and the court held that such a clause
should be strictly interpreted in L’s favour (thus preventing use as an
educational farm on part of the holding). Thus such clauses still give Ls
a strong bargaining hand in deciding whether to agree to non-agricultural
use by T.
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It can be difficult for owners of farmhouses to obtain Agricultural Property
Relief (APR), which might otherwise significantly reduce IHT. The starting
point is that APR applies to the ‘agricultural value’ of the property,
calculated as if the property was ‘subject to a perpetual covenant
prohibiting its use otherwise than as agricultural property’.
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What is BPRA? The answer is Business Premises Renovation Allowance.
It is a new tax relief, designed to encourage conversion and renovation
of empty business properties within designated areas. The result is
100% tax relief on qualifying capital expenditure on conversion or
renovation (from 11 April 2007).
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